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Still Overbanked and Unprofitable? Two Decades of German Banking

Year:    2006

Author:    Koetter, Michael, Nestmann, Thorsten, Stolz, Stéphanie, Wedow, Michael

Credit and Capital Markets – Kredit und Kapital, Vol. 39 (2006), Iss. 4 : pp. 497–511

Abstract

We analyze by means of descriptive evidence the widely held claims that Germany is overbanked and that German banks perform badly in an international comparison. We find that, despite a major merger wave, Germany continues to be more densely bank-populated than France, Italy, and the US. Measured by costincome ratios, non-interest income, and return on assets, German bank performance deteriorated continuously, being particularly affected by the economic slowdown in the very beginning of this century. This relatively poor performance is not driven by one particular banking pillar alone. Instead, all pillars perform badly in international comparison. At the same time, however, Germany's threepillar system exhibits considerable heterogeneity with regard to market structure and performance not only across commercial, savings and cooperative banking sectors but also within each respective pillar. (JEL G21)

Journal Article Details

Publisher Name:    Global Science Press

Language:    Multiple languages

DOI:    https://doi.org/10.3790/ccm.39.4.497

Credit and Capital Markets – Kredit und Kapital, Vol. 39 (2006), Iss. 4 : pp. 497–511

Published online:    2006-10

AMS Subject Headings:    Duncker & Humblot

Copyright:    COPYRIGHT: © Global Science Press

Pages:    15

Author Details

Koetter, Michael

Nestmann, Thorsten

Stolz, Stéphanie

Wedow, Michael

  1. When Measuring the Same Leads to Different Conclusions – A Critical Review of Measures Applied to Assess the Degree of Competition in Banking Systems

    Richter, Toni

    Müller, Holger

    Gischer, Horst

    Credit and Capital Markets – Kredit und Kapital, Vol. 53 (2020), Iss. 1 P.43

    https://doi.org/10.3790/ccm.53.1.43 [Citations: 1]

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